PC Game Piracy Examined

[Page 4] The Scale of Piracy

In the previous sections we focused on the background and theory behind piracy. It's critical to understand these if you want to conduct an informed debate about piracy. Far too many people happily spread all sorts of nonsense about piracy-related issues such as copyright without any understanding of the fundamentals involved. In any case there have been various arguments made in the previous sections which now need to be substantiated with a range of facts and practical examples, and that's what this and the following sections attempt to do.

Let's pause for a moment and consider the following: there's no such thing as 'conclusive evidence' when it comes to piracy. Why? Because by definition piracy is an illegal activity, and thus is deliberately hidden from view. People conducting piracy don't include details of such activities in any official forms they fill out and send to the tax office for example. Individuals engaging in piracy also have a high probability of falsely reporting the extent and nature of their illegal activities and intentions in various surveys and studies, partly due to the negative perceptions they may face, partly to justify their own actions, and partly out of fear of being prosecuted. I worked for several years in the Australian Bureau of Statistics, and I know that statisticians are taught never to apply any moral standards to measuring illegal activities. They strive to measure both legal and illegal activities equally where they are significant enough for inclusion. The problem lies in the fact that it's very difficult to accurately measure piracy, thus there is no conclusive data on piracy which everyone will accept. Instead, to piece together a broad but reasonably accurate picture of piracy we must rely on a wide range of relevant indicators and logical deductions. None of this is perfect, however by comparing, combining and overlapping various data sources and data types, combined with logical deductions, I'm confident that this article contains a reasonably accurate and solid picture of the scale and impact of PC game piracy.

The first step in determining piracy's impact on PC gaming is to see on what sort of scale it is being conducted. There are several ways of gaining an insight into just how large piracy is, and we look at these below:

The Popularity of Piracy Sites

A common measure of a website's relative popularity is through the site Alexa. Alexa's traffic rankings are based on various data, some of which they don't reveal, so while it's not clear precisely how representative Alexa's sample is, for our purposes it should be sufficiently accurate as a broad indicator of relative popularity. Accordingly, I input the addresses of some popular piracy-specific websites, and the results were quite interesting:

The Pirate Bay: A popular torrent search engine, is in the Top 120 Websites globally, and in countries like Sweden it's around the Top 10.

Mininova: A popular torrent search engine, is in the Top 80 Websites globally, and in countries like Pakistan, Algeria, Australia and Greece, it's around the Top 30.

Rapidshare: A general file-sharing service used heavily for hosting illegal material, is in the Top 12 Websites globally.

Many other less significant piracy-related websites also sit in the top few thousand sites in the world, such as Releaselog and Newzleech.

Clearly, by hosting or just linking to illegal material, a site can draw in a huge amount of traffic, to the point where it can project the site into the highly-coveted top few hundred or few thousand sites in the world. Considering there are over 180 million sites in the world today (excluding personal web spaces and the like), this is no small accomplishment. This gives us one impression of the popularity and hence scale of piracy. As an aside, the potential income from owning a piracy-related site is very large; there are literally tens if not hundreds of millions of visitors to each of the sites in the top 100, and it's no coincidence that piracy-related sites are also some of the most ad-covered sites as well, generating massive amounts of money for their owners - we examine this issue in more detail in the Conclusion section.

Piracy as a Proportion of Total Internet Usage

While the sites which provide links to pirated material are at the top of the web popularity list, there's evidence that Peer to Peer (P2P) traffic in particular is monstrously high as a proportion of total Internet traffic. This Report from Multimedia Intelligence shows that at present, P2P traffic makes up approximately 44% of all consumer Internet traffic globally (33.6% in North America). Similarly, this data from Ipoque also points to P2P traffic accounting for a large proportion of all Internet traffic, as much as 54% in places like Southern Europe. Both data sources point out that the vast majority of P2P data currently being shared is, as you'd expect, pirated material, with 70% of it being audio and video files (i.e. songs and movies). The data paints a fairly solid picture of the Internet being absolutely saturated with pirated material, where up to half of all Internet traffic can be composed of illegally shared files at any time.

Global Piracy Rates

Piracy is a worldwide phenomenon, however the rates of piracy are not the same around the world; in some countries piracy is much higher than in others, for a range of reasons. The Business Software Alliance (BSA) commissioned IDC to regularly measure PC software piracy rates around the world, and the latest results are published in the Global Piracy Software Study. The report shows the estimated piracy rate by region for 2006 and 2007:

Note that the results are for all PC software, including operating systems and business software, as well as games. Interestingly, although the piracy rate is falling slightly in most regions, the shift in piracy towards developing regions, and the sheer size of these regions, has resulted in an increase in the average global piracy rate from 35% to 38% between 2006 and 2007. As can be seen, the piracy rates in all countries are very high - the lowest is 21% in North America, and it averages from 30-60% in all other regions. The breakdown by individual country can be seen here. The report concludes that "...by the end of 2007, there were more than one billion PCs installed around the world; nearly half have pirated software on them."

It may be tempting to believe that piracy has always been on the rise, but that's not correct. The 2002 BSA Report shows that between 1996 and 1999, global piracy rates were actually declining every year:

Though the report itself fails to make any mention of the Internet, I believe it seems not uncoincidental that the reversal in the falling rate of piracy occurs at around the same time as Internet usage started to become increasingly more popular among the general population, particularly as a means of distributing illegal software.

An important issue worth noting is the dollar loss figures used in the above reports. I don't agree with them because as discussed in the Economics of Piracy section, it's incorrect to simply assume that every piece of pirated software is equivalent to a full-price lost sale. This is especially true in some countries where software can be almost prohibitively expensive. For example, in China and India, two huge markets with a great deal of piracy, the average salaries even for well-paid professionals is much, much lower than their western equivalents. This Mercer Survey shows that in 2007, someone at the 'IT Manager' level earned on average in US dollars: $25,000 in India, $33,700 in China, $88,000 in Australia and $107,500 in the US. Yet until recently, Microsoft would charge roughly the same price for Windows Vista in China as it did in the US. As this article notes, in late 2007 Microsoft lowered the price for its latest Windows OS in China, for example lowering Vista Home Premium from $238USD to $118USD. However as the article also notes, in practice given many Chinese workers live on annual salaries ranging from $300 to $1000 a year, these price cuts are still not going to make Vista anywhere near affordable for most workers. By the same token, one has to wonder how many of these workers would even own a PC, much less one capable of running Vista.

Another key issue is the availability of software in certain regions. In some countries the availability of certain software is limited, whether due to fewer retail outlets, economic sanctions, or simply because the publisher/distributor deliberately delays or never releases the software in certain regions. This obviously has an impact on increasing piracy, because if consumers are unable to obtain a legitimate copy without experiencing additional costs and/or delays, then piracy becomes a far more attractive option.

The key point then is to consider a range of factors when examining global piracy rates: local software prices, local salaries, general cost of living, and the timely availability of software. In other words when examining piracy by region it's wholly inaccurate to simply calculate that a pirated copy of a PC game in China or India equates to the same potential loss in income as a pirated copy of a PC game in the US or Europe for example.

In any case, we can conclude that the proportional rates of piracy shown above do indicate quite clearly that the scale of piracy is very high all around the world, and that there must be some genuine and likely quite significant economic losses incurred in aggregate due to all this piracy, even if it's not on the basis of each pirated copy being a full-price lost sale.

Game-Specific Piracy Data

The data above indicates the general scale piracy, but the issue at hand is an examination of the piracy of PC games. A reasonably robust method of gauging the approximate scale of PC game piracy is to look at the torrents for the pirated releases of recent big-name games. In most cases there are multiple torrents available for the same game, however below I simply post a brief summary of the numbers involved from only a few of the more popular individual torrents and what they add up to as of the start of December 2008, using the popular torrent search engine Mininova:

There were only 6 PS3-labelled torrents for this game, and I've listed all of them above, adding up to 52,657 downloads over the past year.

For those questioning whether these figures are even remotely accurate, one well-known piracy site recently released a Top 10 Pirated PC Games of 2008 listing, and they even went so far as to insist that torrent figures compiled in this manner should be highly accurate. Their figures also show that my conservative sums above noticeably understate the actual level of torrent piracy:

Remember, none of these torrent figures take into account other forms of piracy which are also substantial, such as File Sharing (e.g. Rapidshare), Usenet, FTP, IRC and of course physical piracy, so they may still significantly understate the true scale of piracy. However they do clearly indicate that piracy is rampant. As we'll see later on, many PC games don't usually sell beyond 1-2 million copies throughout their entire lives, so when the number of torrent downloads in one year for some games approaches that level as shown above, it's a substantial level of piracy.

Update: For 2009, the most pirated PC game as reported in this article was Call of Duty: Modern Warfare 2. The PC version had a staggering 4.1 million downloads via torrents alone compared with an estimated 200,000 - 300,000 actual sales via retail and Steam, demonstrating that the most popular game of 2009 was also the most pirated, and more importantly, that the actual number of downloads for the most popular game is now almost three times as high as in 2008, signalling the rampant growth of piracy. It is also interesting to note that while COD:MW2 sold around 300,000 copies on PC and had 4.1 million pirated downloads, the console version sold in excess of 6 million copies during the same period according to this article, and yet had a fraction of the number of pirated downloads at around 970,000.

Update: For 2010, the most pirated PC game as reported in this article was Call of Duty: Black Ops, at 4,270,000 downloads via torrents, compared with 930,000 downloads for the XBox 360 version of the same game. It's not surprising then to see that the PC version of Black Ops is estimated to have only made up only 6% of the total sales for the game in the UK for example, while the XBox 360 version accounted for 54% of sales, and the PS3 at 40%. It's also interesting to note the remainder of that list of top 5 downloaded PC games includes the most popular games of 2010: Battlefield: Bad Company 2, Mafia 2, Mass Effect 2 and StarCraft 2, each one racking up more than 3 million downloads - that's around three times the highest downloaded XBox 360 game, or equivalent to the total number of people playing a PC game on Steam at any one time.

Update: For 2011, the most pirated PC game as reported in this article was Crysis 2 at 3,920,000 copies. Surprisingly, Crysis 2 does not appear in the top 5 pirated games on XBox 360. Instead, we must look to two other games in the most pirated games lists - Battlefield 3 and Call of Duty: Modern Warfare 3 - for comparisons between PC and console piracy. Battlefield 3 was pirated at least 3,510,000 times on PC compared to 760,000 on XBox 360, while Call of Duty: Modern Warfare 3 was pirated 3,650,000 times on PC compared to 830,000 on XBox 360 - in both cases showing roughly 4.5 times as much piracy on PC than console for the same game, which continues the trend of previous years.

So far the information in this section has provided us with enough data to make some initial observations:

Game piracy is not being conducted on a small scale, it is clearly substantial. Pirated copies are easily and widely available; some games even up to a year old can have up to a hundred active torrents through which someone can obtain the game.

Piracy of the PC versions is orders of magnitude above that of the console versions in the cases we examined. For example Call of Duty 4 has five times as many downloads on the PC version as it does on the XBox 360 and PS3 versions combined. As we will see in the PC vs. Console section, this also appears to line up with its apparent sales ratio: five times as many sales on consoles than on PC. Similarly, Fallout 3 has almost ten times as many PC downloads as it does console downloads, supported by its general sales ratios.

More popular/desirable games are pirated more heavily than less popular games. The entire top 10 pirated games list doesn't contain any truly unpopular games, indeed some of the most popular good quality games of 2007/08 appear on the list. Similarly when searching torrents, I found more popular games have far more individual torrent listings than less popular games. This clearly contradicts the claim that 'good games get pirated less' - we see more evidence of the fallacy of this claim throughout this article.

Finally, on the contentious topic of DRM, aside from Spore whose audience may well have fallen victim to DRM-induced hysteria, the presence of intrusive DRM appears not to increase piracy of a game. For example Call of Duty 4, Assassin's Creed and Crysis all have no intrusive DRM whatsoever: they all use basic SafeDisc copy protection with no install limits, no online activation, and no major reports of protection-related issues. Yet all were pirated heavily enough to have the dubious distinction of being in the Top 10 downloaded games list. But strangely absent from the list are several popular games which do use more intrusive DRM: BioShock, Crysis Warhead, and Mass Effect. This indicates quite clearly that intrusive DRM is not the main reason why some games are pirated more heavily than others. We examine this issue in more detail in the Copy Protection & DRM section.

These initial findings shed some interesting light on both the scale and nature of piracy. However examining torrent piracy is only one way to measure the scale of PC game piracy. Gaming companies have other ways in which they can determine and cross-check how many non-legitimate versions of their games are in use. One method which is reasonably robust - and coincidentally highlights one of the directly measurable costs of piracy - is to look at tech support requests made by people who are using a pirated copy of a game. There are several examples which cement the picture of both the scale of piracy being extremely high compared to legitimate sales, and the direct costs of piracy also being high due to their imposition on limited tech support resources. Mike Russell, QA Manager of Ritual Entertainment, makers of the SiN Episodes games, discusses the impact of the scale of piracy on tech support in this article:

Some recent calculations revealed that, last week, gamers with pirated copies of Emergence requesting support outnumbered gamers with legitimate copies of Emergence requesting support by a ratio of nearly five to one. This, understandably, is a source of great frustration for Russell, who is essentially performing two jobs at Ritual and who only has a finite amount of time to spend on each. Responses he has received when attempting to troubleshoot problems have laid painfully bare which users are playing the game illegally. "What's Steam?" one asked. "I don't have one," replied another when asked for his Steam ID. "Oh, my copy didn't come with an installer," replied yet another user, "it's in a folder on a DVD. I just drag it to my machine and then run the game." For an independently funded developer such as Ritual, these time sinks and lost sales have a clear and measurable impact on the company's income and, thus, its long term self-sufficiency.

Bethesda Softworks, makers of The Elder Scrolls series and most recently Fallout 3 had this to say on the issue of the scale and costs of piracy-related tech support:

The amount of times we see stuff coming through where it’s like, the resolution to the problem was [the] guy had a pirated copy of the game… The amount of money we spend supporting people who didn’t pay us for the game in the first place…it’s f–ing ludicrous. We talk to other developers, guys who are [like] ‘Yeah, it’s a third, it’s 50% of our [customer] support.’

Similarly the developers of a popular free mod called Portal: Prelude also speak out about the level of piracy of the game Portal which they've witnessed:

Seriously guys, stop sending us emails because you can't install the game, because you can't launch the game, or because you have weird errors everywhere. We're not going to help you make the mod work on pirated versions of Portal or without Steam. This mod needs an original and legit Portal because it also uses some of the content of Half-Life 2 that extends Portal. Of course, this content doesn't seem to be included in the pirated version of Portal.

In fact piracy of Portal is an interesting case to examine. A quick search on Mininova currently reveals around 30 active torrents for The Orange Box, a game package released in November 2007 of which Portal was a part. For those who don't know, The Orange Box is famous for being one of the best gaming deals of 2007/2008 - five major games in one package (Half Life 2, HL2: Episode 1, HL2: Episode 2, Team Fortress 2, Portal) all for the price of a standard game, distributed via Steam with no intrusive DRM, and receiving nothing but praise from reviewers and gamers alike. Yet here are people who not only pirated this game, but are also requesting support for it.

Update: The game Batman: Arkham Asylum incorporated a deliberate glitch which prevented users from successfully using Batman's glide functionality, but this only occurred on pirated copies of the game as reported here. Many people made forum posts requesting support for this "bug", only to discover that they had inadvertantly exposed themselves as pirates. Similarly, the game Aliens vs. Predator had several issues unique to the pirated version, and once again forum posts such as this one revealed that pirates are not above requesting support for their illegitimate games. It also goes to demonstrate how pirated copies can damage the reputation of developers, because glitches and bugs in pirated versions are often being blamed on the game itself rather than the piracy groups which made these illegal cracked copies.

I've saved an excellent example for last. As an indication that not only is the scale of piracy generally high across all types of games, but more importantly, that it seems to have little to do with DRM, big greedy game companies, or the high price of games, let's take a look at a game called World of Goo, recently released by a small independent developer called 2D Boy consisting of a team of 3 people. It's available as a digital download, selling for less than $20 on Steam, it has no intrusive DRM, and it's received nothing but praise, reflected in a Metacritic Score of 90%/95%. This should be precisely the recipe for preventing piracy according to some, but unfortunately the truth is less convenient: the developer of the game has stated that World of Goo has an approximate piracy rate of 90%. Regardless of the precise level of piracy, the key point to consider is that World of Goo addresses every single item on the checklist of excuses which people usually present for pirating games - yet it is still being pirated quite heavily.

Update: Just to show that World of Goo wasn't an isolated case, there is yet another example of the irrelevance of DRM, big greedy companies and high prices to piracy. The independent game Machinarium, released by a small Czech developer and priced at $20 with no DRM also has the dubious honor of a 90% piracy rate.

Update: A common complaint from gamers is that most PC games these days are ported over from the console versions (which they often are), and hence this fact is used to justify rampant piracy. However a 2011 PC exclusive by the name of The Witcher 2 provides solid evidence that this excuse is just a smokescreen. The Witcher 2 is a detailed role playing game made by independent polish developers CD Projekt solely for PCs in its first year of release. It proved very popular with PC gamers, garnering a Metacritic Score of 88%/83%. Some versions of the game came with DRM, but this was quickly removed in initial patches, and the game also received a lot of free bonus content. Did this prevent or reduce piracy? Not one bit. The Witcher 2 has an estimated 80% piracy rate, once again proving that trying to address the fanciful excuses people make for piracy can be fruitless. CD Projekt is discussed further in the Copy Protection & DRM section of this article.

Having established that there's a major disparity between PC and console piracy in this section, in the following section we look more closely at the differences between the PC and consoles.